Circular No. 18/2008/TT-BXD supplements certain methods for determining construction costs in project estimates under Circular No. 05/2007/TT-BXD on the establishment and management of investment costs for construction projects issued on July 25, 2007 by the Ministry of Construction.

CIRCULAR

Supplemental guidance on certain methods for determining construction costs in project estimates is added to Circular No. 05/2007/TT-BXD dated July 25, 2007, issued by the Ministry of Construction regarding the preparation and management of investment construction project costs.

Pursuant to Decree No. 17/2008/NĐ-CP dated February 4, 2008, promulgated by the Government, stipulating the functions, tasks, powers, and organizational structure of the Ministry of Construction;

Pursuant to Decree No. 99/2007/NĐ-CP dated June 13, 2007, promulgated by the Government, on the management of investment construction project costs.

The Ministry of Construction supplements certain methods for determining construction costs in project estimates into Section 2.2.1, Point 2, Part II of Circular No. 05/2007/TT-BXD dated July 25, 2007, issued by the Ministry of Construction (referred to as Circular No. 05/2007/TT-BXD) as follows:

1. DETERMINING CONSTRUCTION COSTS BASED ON QUANTITY AND FULL CONSTRUCTION UNIT PRICE

When using full construction unit prices (including comprehensive full construction unit prices and detailed full construction unit prices), construction costs in project estimates shall be determined as follows:

1.1. Construction costs determined based on comprehensive full construction unit prices

1.1.1. The quantity of construction work used to determine construction costs based on comprehensive full construction unit prices is determined from technical design drawings or construction drawings, the tasks to be performed for the project, and sub-projects, and is compiled from a group of construction works to form a structural unit or part of the project.

1.1.2. Comprehensive full construction unit prices are established corresponding to the list and content of the quantity of construction work.

Comprehensive full construction unit prices include material costs, labor costs, construction machinery costs, other direct costs, general costs, and pre-tax income, and are based on detailed construction unit prices.

Detailed construction unit prices used to establish comprehensive full construction unit prices are guided at Appendix 4 of Circular No. 05/2007/TT-BXD.

1.2. Construction costs determined based on detailed full construction unit prices

1.2.1. The quantity of construction work used to determine construction costs based on detailed full construction unit prices is determined from technical design drawings or construction drawings, the tasks to be performed for the project, and sub-projects, consistent with the list and content of construction work in detailed unit prices.

1.2.2. Detailed full construction unit prices include material costs, labor costs, construction machinery costs, other direct costs, general costs, and pre-tax income, and are established according to the guidance at Appendix 4 of Circular No. 05/2007/TT-BXD.

1.3. Construction costs determined by a combined method

Based on the level of aggregation or detail of the quantities of construction work determined under Sections 1.1 and 1.2 above, both types of full construction unit prices can be used in combination to determine construction costs in project estimates.

Construction costs determined based on full construction unit prices are guided at Appendix 1 of this Circular.

2. DETERMINING CONSTRUCTION COSTS BASED ON TOTAL MATERIAL, LABOR, AND CONSTRUCTION MACHINERY WASTAGE VOLUMES AND CORRESPONDING PRICES

Material, labor, and construction machinery costs in construction costs may be determined based on total material, labor, and construction machinery wastage volumes and corresponding material prices, labor prices, and construction machinery prices.

2.1. Determining total material, labor, and construction machinery wastage volumes

Total wastage volumes of various materials, labor, and construction machinery are determined based on the wastage of materials, labor, and construction machinery for each quantity of construction work of the project and sub-projects as follows:

- Determine each quantity of construction work of the project and sub-projects as stated in Section 1.2.1 above.

- Determine the volumes of various materials, labor, and construction machinery corresponding to each quantity of construction work according to the technical design or construction drawings of the project and sub-projects through the wastage rates of materials, labor, and construction machinery to complete a unit volume of construction work based on construction standards and technical regulations.

- Calculate the total wastage volumes of each type of material, labor, and construction machinery for the project and sub-projects by aggregating the wastage of all similar materials, labor, and construction machinery of different construction works.

When calculating, clearly specify the quantity, unit, type, specifications, and codes for materials; the number of working days for each level of workers; and the number of machine shifts for each type of machine and construction equipment according to key technical parameters and shift codes in the construction machine price table.

2.2. Determining material prices, labor prices, and construction machinery prices

Material prices, labor prices, and construction machinery prices are determined in accordance with the construction project and linked to the location of the construction project.

Material prices, labor prices, and construction machinery prices are determined as Clause a.2.2, Section 2.2.1, Point 2, Part II of Circular No. 05/2007/TT-BXD.

Construction costs determined based on total material, labor, and construction machinery wastage volumes are guided at Appendix 2 of this Circular.

3. DETERMINING CONSTRUCTION COSTS BASED ON THE UNIT COST OF CONSTRUCTION IN THE INVESTMENT CAPITAL OR BASED ON SIMILAR ECONOMIC-TECHNICAL PROJECTS ALREADY COMPLETED

- Construction costs of auxiliary projects, temporary projects for construction, or simple common projects can be determined based on area or usage capacity and the unit cost of construction in the investment capital.

- Construction costs of such projects can also be determined based on the construction costs of similar economic-technical projects already completed and adjusted according to the characteristics of the construction and the time of preparing the estimate.

The construction costs shall be determined based on the construction cost unit in the investment capital or on the basis of projects with similar economic-technical indicators that have been implemented, in accordance with the guidance provided in Appendix 3 of this Circular.

4. IMPLEMENTATION ORGANIZATIONS

This Circular takes effect fifteen days after its publication in the Official Gazette. Any difficulties encountered during implementation should be reported to the Ministry of Construction for consolidation and study to resolve.